As the name suggests, an automated trading system is a mechanism that allows an equity investor to create rules for trading various assets and derivatives so that the trades are carried out by a computer. You only need to define the entry and exit rules of a transaction and the algorithm takes care of the rest One of the most used tools for investing in the stock market: algorithmic trading or Automated trading.
The best decisions are made with a calm and thoughtful mind.
The most important factor controlling the market is sentiment. Also the most astute investor quickly realizes that his best investment decisions are made with a calm and thoughtful mind. What could be better than a computer driven by rules and criteria that favor you in performing your transactions optimally.
You first select one Trading platform Automate and define the parameters of your trading strategy. The terms and conditions created this way, your personalized algorithm will follow them to place orders for you. Your trading strategy established in this way will constantly monitor the market price and automatically execute orders if predetermined parameters are respected. The goal is to execute orders more quickly and efficiently and take advantage of market events.
For example, to take advantage of an arbitrage opportunity in the forex market, you must enter an amount to buy or sell a currency. Once the software is complete, you will benefit from an automated trading system.
Decisive advantages of automated trading
You suppress emotions: Everyone often experiences strong emotions that negatively affect their decision making. If you set the rules in a calm and thoughtful mind, the system will support trading and reduce the chances of drift and over-trading.
You reduce errors : The machine is more efficient than a human in carrying out an order that does not require the subjective application of mind. For an order of 1000 shares only an order of 100 shares cannot be taken by the machine.
You save time and money : Several actions are performed at the same time, the best advantage of an automated trading is that it is actually automatic, which means that you do not always need human intervention to manage it. So you can redirect your time and energy towards building a good trading routine and managing multiple accounts at the same time.
You diversify easily : With automated trading you can trade on multiple accounts at the same time, but also Trade multiple strategies at the same time. You can therefore reduce risk and diversify by applying several strategies that oppose each other.
You gain the precision of executing: Making a decision at the right time in a rocky market is often difficult. Algorithmic trading places your orders instantly and does so in a fraction of a second.
You discipline your discussion : Even the most seasoned can sometimes be taken by market euphoria or depression, automated trading ensures you a discipline in executing your operations.
The advantages of automated trading are decisiveness, high accuracy, fast execution of orders, possibility of diversification… allowing your negotiations to be successful by making them more relevant.